Virgin Media 2011 Annual Report Download - page 32

These restrictions could also materially adversely affect our ability to finance future operations or capital
needs or to engage in other business activities that may be in our best interests. We may also incur other
indebtedness in the future that may contain financial or other covenants more restrictive than those applicable
under our current indebtedness.
We are a holding company dependent upon cash flow from subsidiaries to meet our obligations.
Virgin Media Inc. and a number of its subsidiaries are holding companies with no independent operations or
significant assets other than investments in their subsidiaries. Each of these holding companies depends upon the
receipt of sufficient funds from its subsidiaries to meet its obligations.
The terms of our senior credit facility and other indebtedness limit the payment of dividends, loan
repayments and other distributions to or from these companies under certain circumstances. Various agreements
governing our debt may restrict and, in some cases, may also prohibit the ability of these subsidiaries to move
cash within their restricted group. Applicable tax laws may also subject such payments to further taxation.
Applicable law may also limit the amounts that some of our subsidiaries will be permitted to pay as
dividends or distributions on their equity interests or as loans, or even prevent such payments.
Risks Relating to Our Common Stock
Conversion of our convertible senior notes will dilute the ownership interest of existing stockholders.
Any issuance by us of our common stock upon conversion of our convertible senior notes will dilute the
equity ownership interest of existing stockholders, including holders who have received shares of our common
stock upon prior conversion of our convertible senior notes. Additionally, our convertible senior notes include
anti-dilution and “make-whole” premium provisions that, if triggered, would result in an increase in the number
of shares of our common stock issuable upon conversion of the convertible senior notes. Conversion of the
convertible senior notes in circumstances where these provisions have operated could have a significantly greater
dilutive effect.
Sales in the public market of the common stock issued upon conversion could adversely affect prevailing
market prices of our common stock. In addition, the existence of the convertible senior notes may encourage
short selling by market participants.
We may in the future seek to raise funds through equity offerings, which could have a dilutive effect on our
common stock.
In the future, we may determine to raise capital through offerings of our common stock, securities
convertible into our common stock, or rights to acquire these securities or our common stock. In any case, the
result would ultimately be dilutive to our common stock by increasing the number of shares outstanding. We
cannot predict the effect this dilution may have on the price of our common stock.
We may not continue to pay dividends, and the failure to do so could adversely affect our stock price.
The decision to pay a dividend and the amount of any dividend is solely at the discretion of the Board. Our
Board may decide not to continue to pay dividends on our common stock at the same level as in recent years, or
at all. Any failure to pay a dividend could adversely affect our stock price.
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